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Yep, in more Morrowind news, PC.ign posted an interview with the project leader for the game, Todd Howard. To pique your interest in this piquant exchange:

IGNPC: What sort of improvements have the magic and combat systems received for this outing?

Todd Howard: The magic system has been re-balanced considerably. We've also added a new school of magic. We've also expanded alchemy quite a bit so that characters can specialize in potion-making.

As for combat, we're using a system where you can use weapons in different manners and they will perform differently. You'll want to use a dagger differently than an axe, and each has its advantages. Speed and weight has significant impact on how a weapon works.